If you want to invest with a clean conscience, look no further. RBC Capital has just released a report revealing its favorite stocks for sustainable investing. These are stocks that the firm rates Outperform (the equivalent of Buy) according to its traditional fundamental financial analysis - and that score highly on key environmental, social and governance (ESG) factors.
ESG spans a wide array of factors, from being environmentally sustainable and protecting consumers to boasting gender diversity in the boardroom and ensuring equal pay for employees, and many more.
"It is thought that ESG factors can be strong signals for future opportunities as well as potential risks including share price volatility, earnings stability and issues management," write RBC Capital analysts, adding, "incorporating environmental, social and governance factors alongside traditional financial analysis can be additive as indicators of corporate performance."
Indeed, a Morningstar study of its ESG indexes released earlier this year showed that sustainable investing pays off. "We found that 41 of the 56 Morningstar's ESG indexes outperformed their non-ESG equivalents (73%) since inception," it says. "... Morningstar ESG indexes tend to select companies that are less volatile and possess stronger competitive advantages and healthier balance sheets than their non-ESG equivalents."
Here are five of the best ESG stocks on RBC Capital's "Global ESG Best Ideas List." Each of the stocks not only gets RBC's seal of approval, but sports a Moderate Buy or Strong Buy consensus rating from analysts tracked by TipRanks.SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks
When folks think of the Berkshire Hathaway (BRK.B) portfolio and its collection of holdings, most of which were selected by Chairman and CEO Warren Buffett, the companies that most readily come to mind are probably American Express (AXP), Coca-Cola (KO) and, more recently, Apple (AAPL).
But a deep dive into Berkshire Hathaway's equity holdings reveals a more complicated picture.
Berkshire Hathaway held positions in 47 separate stocks as of June 30, according to the most recent regulatory filing (Aug. 14) with the Securities and Exchange Commission - down from 48 in the first quarter of this year, as he dumped USG Corp. (USG). But the portfolio of "Buffett stocks" isn't as diversified as the number might suggest. In some cases, BRK.B holds more than one share class in the same company. Some holdings are so small as to be immaterial leftovers from earlier bets the Oracle of Omaha has yet to completely exit.
And perhaps most importantly, Berkshire Hathaway's equity portfolio is actually pretty concentrated. The top six holdings account for almost 70% of the portfolio's total value. The top 10 positions comprise 80%. Banks and airlines, to cite a couple of sectors, carry quite a load in this portfolio. Then there's the fact that several Buffett stocks actually were picked by portfolio managers Todd Combs and Ted Weschler.
Here, we examine each and every holding to give investors a better understanding of the entire Berkshire Hathaway portfolio.SEE ALSO: 50 Top Stocks That Billionaires Love